Polls also show the majority of the public would support bringing services under public ownership.
Polls also show the majority of the public would support bringing services under public ownership
Households would save around £250 a year if energy, water and rail were in public ownership.
New research by Corporate Watch and We Own It suggests that savings would be made both from shareholder profits not being paid as well as from the fact that the government could borrow more cheaply than private companies to raise the money needed to invest in services.
In 2013, private energy, water and rail companies paid out £12.7 billion to investors. If these services went public, there would be a total saving of £6.5 billion; £4.2 billion from energy, £2 billion from water and £352 million from rail services.
This would filter down to household savings of £160 on electricity and gas, £75 on water and £13 on railways.
This week is important in assessing the impact of privatisation. Monday marked the 28-year anniversary of gas privatisation while Thursday will mark 24 years since electricity privatisation. Friday is the 25th anniversary of water privatisation.
The research also comes just after the government’s decision to reprivatise the East Coast railway.
Prices of these services have been have been outstripping inflation for years. Between 2007 and 2013, household gas and electricity bills rose in real terms by around 41 per cent and 20 per cent respectively.
In real terms, water bills have increased by 50 per cent since privatisation, while rail fares are 23 per cent higher than they were in 1995. These companies are owned by some of the richest people in the world, including banks, investors and foreign governments.
Cat Hobbs, director of We Own It, said:
“Households are getting squeezed by ever rising train ticket prices, energy bills and water bills, while incomes can’t keep pace. Politicians talk about the cost of living, but it’s time to look at the cost of privatised living.
Privatisation is a failed experiment while public ownership could be a much more efficient alternative. We could run these services ourselves and save money, either for households or for government.”
According to polls, 66 per cent of the public want railways to be in public ownership, 68 per cent want energy to be in public ownership and 71 per cent want water to be in public ownership.
The authors of the research add that the actual savings of making these services public would probably be even higher than estimates, as the costs involved in regulating and outsourcing private services would be eliminated.Like this article? Sign up to Left Foot Forward's weekday email for the latest progressive news and comment - and support campaigning journalism by making a donation today.